A new report by a tax watchdog group shows Tennessee has the highest combined state and local sales tax rates in the nation, ahead of Arkansas, Louisiana, Washington and Oklahoma.
The report by the Tax Foundation shows Tennessee has an average combined state and local sales tax of 9.44 percent. That's .26 points higher than Arkansas at 9.18 percent and .55 points higher than Washington's 8.89 percent, according to the report released Wednesday.
Tennessee has no standard state income tax, but it does have a 6 percent Hall income tax rate paid by residents who earn interest or dividend income. The Hall tax was enacted in 1929. The Tennessee General Assembly this year approved Gov. Bill Haslam's legislation to raise the Hall tax exemption level for Tennesseans age 65 and older from $26,000 to $33,00 for single filers and from $37,000 to $59,000 for joint filers.
The Hall tax yielded a per person tax of $27 in 2010, according to the report.
For more read Friday's Chattanooga Times Free Press.